Krusty the Clown is informed by his producers that his show is dropping in ratings with the demographics of young girls, and therefore they will introduce a new character named Princess Penelope. Her act features singing, glitter, and a unicorn, which — though immediately attracting a youthful female audience — disgusts the series' predominately male audience, as well as Krusty himself. Soon, the Krustylu Studio becomes almost completely filled with girls (including Lisa), and all of Krusty's merchandise is replaced by that of Penelope's. However, Bart does not like it and complains that "...women ruin all the great things" (the Army, the Fantastic Four and American Idol "what would be better with only Simon Cowell and Randy Jackson"). Bart demands that Krusty do something in order to restore the show.
Krusty follows Bart's advice and confronts Penelope in her dressing room. Penelope admits she has followed Krusty ever since she was a young girl, who grew up in Mineola, Long Island, New York. They consequently discover that they share a mutual attraction towards one another. Subsequent episodes of The Krusty the Clown Show feature the two singing love songs to one another, culminating in Krusty's marriage proposal to Penelope and the latter's acceptance. On the wedding day, Bart and Milhouse attempt to sabotage the marriage by showing Penelope Krusty's former wives, Holly Hippie and Eartha Kitt (who divorced Krusty six hours after they got married), who both despise him. Penelope still wants to get married, but Krusty decides that he is not good enough for Penelope and cancels the wedding. Penelope moves to France, only to discover that Krusty is there and apologizes for leaving her. She accepts and the two float down the Seine River together into the night.
In the subplot, budgeting issues cause Mr. Burns to eliminate donuts from the lunch room, shocking Homer, Lenny, and Carl. While at Moe's Tavern, a corporate recruiter named Gator McCall offers them a job at the Capital City Nuclear Power Plant. The trio agree to take a tour, where they discover there are luxurious working conditions, including free massages, sushi, and cartoonist Gary Larson, who has come out of retirement to draw The Far Side cartoons for plant employees. They accept the offer.
As Homer, Lenny, and Carl carry their personal possessions from Springfield Nuclear Power Plant, Mr. Burns confronts them. After begging is unsuccessful, Burns offers to reinstate even better donuts if they return to work at his power plant. The trio then accepts the offer.